Tax Increment Financing (TIF) Analyses

Vantage Point Economic and Transportation Development Strategies, LLC senior professionals have extensive experience and expertise in tax increment financing (TIF), a financial tool based on future tax revenue within a designated area. TIF is becoming ever more popular as a primary method to municipalities in funding community improvement projects and providing economic incentives to future private and public/private development endeavors. These methods are brought about by bond financing and/or appropriation of funds generated through tax increment of existing properties and future real estate development. Experience has been gained in all aspects of TIF as required by our clients, including TIF analysis and the establishment of TIF districts.

TIF analysis includes review of the current tax base, projections for future tax base growth, and calculation of maximum amount of bond financing available to the municipality. Analysis begins with collecting all tax assessment data for all parcels within the proposed TIF district, or TIF boundary area to determine the current assessed market value and total tax revenue generated within the CRA. Future tax base growth depends on existing commercial and residential developments and planned new development. The amount of bond financing is dependent upon budget forecasting in the initial years of TIF and eventual percentage of tax increment earmarked and allocated to redevelopment efforts.

Establishment of a TIF district – separate and/or included as part of initial TIF analysis – involves all necessary analysis, documentation and reports as required by state law for a municipality to execute its TIF powers.  A TIF district is the area or single site in which tax increment revenue is collected for redevelopment purposes. TIF districts may be named tax allocation districts (TAD), community redevelopment areas (CRA), or redevelopment areas (RDA), depending upon the state. Required services may include documentation and analysis of economic conditions, an area’s physical characteristics, and/or initial redevelopment goals and objectives within the TIF district. Then, the amount of tax increment generated (by time-period) can be projected, and the total amount of bond financing to be generated for redevelopment and/or community improvement initiatives.